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Hockey blasts attitude of 'entitlement'

Shadow treasurer Joe Hockey condemns systems of 'universal entitlement' in Western democracies.

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Since being sent to the Opposition benches in 2007, the Coalition has fought almost every effort by Labor to means-test or otherwise curb welfare entitlements.

The Howard government, while reducing personal taxes consistently, also took the entitlement mentality to new heights with the raft of so-called middle class welfare measures. 

Apart from supporting budget crackdowns on the proliferation of such benefits as the disability support pension, it has opposed any move by the government to go after so-called middle-class welfare, moves the government says are vital to keep spending sustainable.

Shadow Treasurer Joe Hockey.

Shadow Treasurer Joe Hockey Photo: Penny Bradfield

Measures which created structural deficits such as the private health insurance rebate, the baby bonus or the family tax benefit system have been capped or means tested by Labor and the Coalition has opposed or criticised all of them.

Furthermore, it has promised to remove the means tests and restore the rebates if re-elected and is promising a few more entitlements of its own, the most significant being the $3.1 billion paid parental leave scheme, to be funded by a tax on business with a small top-up from the budget.

Therefore, it is more than a little strange for the shadow treasurer, Joe Hockey, from the relative safety of London, to give a speech and TV interview railing against the age of entitlement in Western nations and arguing for the need to tighten up.

"Western communities, Western societies are going to have to make some very hard and unpopular decisions to wind back the involvement of the state in peoples lives," he said.

Hockey's criticisms were largely aimed at European nations and their generous welfare systems but, he said, it also applied to Australia.

"We need to be ever-vigilant. We need to compare ourselves with our Asian neighbours where the entitlements programs of the state are far less than they are in Australia," he said.

A lower level of entitlement "reduces taxation, meaning individuals spend less of their time working for the state and more of their time working for themselves and their family".

The shadow treasurer singled out compulsory superannuation as an example of easing the burden on the state.

"Over the years, governments have worked to reduce the exposure of the government to our pension system with the compulsory superannuation contribution program which means that people are contributing to their own pension rather than everyone relying on the government for the pension."

No mention that the Coalition opposed compulsory superannuation when Paul Keating introduced it and, most recently, it voted against lifting the rate from 9 percentage points to 12 as part of the mining tax package.

The Howard government, while reducing personal taxes consistently, also took the entitlement mentality to new heights with the raft of so-called middle class welfare measures it introduced and which Labor has been paring back.

 

Hockey did concede that his criticism that entitlments in western democracies were "fuelled by short-term electoral cycles and the political outbidding of your opponent'' applied to the programs set up under the Howard government.

In isolation, everything Hockey said made rational economic sense and it will do his standing no harm with the right of the Liberal Party.

Hockey has started to portray himself as the economic hardliner in the Coalition. This builds on his resistance, both internal and external, to further subsidies for the automotive industry and his pledge, that if elected, to  not subsidise industries the Coalition believes to be unsustainable.

But the approach lacked consistency with much of what the Coalition has said and done more broadly, suggesting there may be an internal struggle going on.

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